The decision to revise the financial perspective will be taken jointly by the two arms of the budgetary authority acting in accordance with the majority voting rules laid down in the fifth subparagraph of Article 203(9) of the Treaty.

13. The institutions, acting on a proposal from the Commission, will examine the scope for reallocating expenditure between the programs covered by the heading concerned by the revision, with particular reference to any expected underutilization of appropriations.

The objective should be that a significant amount, in absolute terms and as a percentage of the new expenditure planned, should be within the existing ceiling for the heading.

The institutions will also examine the scope for offsetting raising the ceiling for one heading by lowering the ceiling for another.

They undertake, however, not to allow any revision of the compulsory expenditure in the financial perspective to lead to a reduction in the amount available for non- compulsory expenditure.

Any revision must maintain an appropriate relationship between commitments and payments.

D. Consequences of the absence of a joint decision by the institutions on the adjustment to, or revision of, the financial perspective

14. If the institutions fail to reach a joint decision on any adjustment or revision of the financial perspective proposed by the Commission, the objectives set previously will, after the annual technical adjustment, continue to apply as the expenditure ceilings for the year in question.

E. Reserves

15. In accordance with the conclusions of the Edinburgh European Council, three reserves are entered in the general budget of the European Communities. The necessary resources will be called in only when these reserves are implemented.

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